Indonesia uses the average CPOspot price at the port of Rotterdam as a benchmark to set its monthly CPO exporttax. The tax, which can reach as high as 25% according to an article byCommodity Online, is imposed to ensure sufficient domestic supplies ofthe oil when global CPO prices are high by discouraging exports.Indonesia as being a leading CPOexporter is likely to increase the world CPO price with this practiceand thereby harms commercial interests of importers.

Further changes in the export tax:On 25 August 2011, Indonesia decided to lower the export tax on palm oil. The maximum export tax will decrease from 25% to 22.5% and even 13% in the case of refined palm products. This measure came into force on 1 October 2011.

In October 2012, crude palm oil was taxed at 13.5%. In the following month, Indonesia lowered the taxes to 9% for crude oil and 3% for refined products. In January 2013, they trimmed the export tax for crude palm oil to 7.5%. Later in January, the Government confirmed the tax be further decreased in 2013:

'Ideally, it should be zero to allow us to compete with the rival, which applies zero per cent' (Trade Minister Gita Wirjawan on 11 Jan 2013).

On 26 September 2014, the Indonesian Ministry of Trade introduced regulation 60/M-DAG/PER/9/2014 which practically removed the export tax on crude palm oil for October 2014. Considering the falling palm oil prices, the export tax removal will affect also 27 other palm products.

On 31 December 2015, the Indonesian Ministry of Trade published a press release citing its regulation 122/M-DAG/PER/12/2015. The regulation lowered the reference price from 580.37USD/MT to 578.88USD/MT. Given the low market prices, the actual export duty has remained at 0 USD.